update 2-s.africa\'s mondi to buy oaktree asset for $782 mln

by:Homkey Packaging     2020-10-19
* Payment of 240 mln euros in cash * Nordenia debt with a value of 398 mln euros * transactions support its consumer packaging business (
Recasting, adding details)
On July 11, Fort David Dolan and tiesso Morson Johannes (Reuters)-
South Africa\'s Mondi Group said it would buy German packaging company Nordenia International from Oak Capital, a $0. 782 billion deal that would give the paper maker a bigger presence in consumer packaging.
Mondi focuses on emerging markets mainly for $3.
On Wednesday, the company said it would buy 93 shares with a market value of 2 billion.
In cash and debt transactions, 4% of Nordenia comes from private equity firm ockett and other minority shareholders.
More than 90% of Nordenia\'s income comes from packaging and components of consumer goods such as pet food, diapers and chocolate bars.
The company has operations in Europe, North America and Asia, but nearly 60% of its sales come from Western Europe.
\"Nordenia itself is an attractive business that has synergies with Mondi\'s much smaller consumer packaging business,\" said Justin Jordan, an analyst at Jeffries in London.
\"The niche of consumer packaging is growing structurally, faster than in some areas of Mondi.
\"As the global paper industry struggles with overcapacity and weak demand, like its competitors, Mondi has been trying to diversify its business.
According to the company\'s report, consumer packaging accounted for only 5% of Mondi Group\'s revenue as of December 2011.
Mondi said that it would pay 0. 24 billion euros in cash and bear Nordenia debt worth 0. 398 billion euros, and will acquire 0. 638 billion euros ($782 million).
Mondi said the cash portion of the deal would be funded from a new bank loan of 0. 25 billion euros.
Mondi estimates that the acquisition will result in 15 million euros per year.
And said it would be able to keep its dividend policy unchanged.
According to the competition license, the transaction is expected to be completed in the fourth quarter of this year.
Rothschild, an investment bank, served as a consultant to Mondi in the transaction. Johannesburg-
Mondi\'s listed shares fell by 0. 70 hours 7%80 rand.
So far, the company\'s share price has risen 25% this year, surpassing Johannesburg\'s top 5%. 40 index. ($1=0. 8160 euros)(
Edited by Ed Stoddard and Mike Nesbit)
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